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The reactions to Myanmars dramatic decision last week to halt the construction of the $3.6 billion Myitsone hydroelectric power project financed by China have been quite as dramatic. If anything,it has been over-interpreted,variously hailed as a triumph of civil society movements; the arrival of Thein Sein,Myanmars newly elected president as a forceful leader in his own right; as a rare show of courage in standing up against China; as well as a strong political signal to the international community of its commitment to stay the course on the roadmap to democracy and civilian rule. Perhaps all of the above?

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While each of these elements can be debated,there is no one solution to the set of challenges facing the leadership. In the political imagination,Myitsone is more likely to be seen as a testing of the waters on a range of difficult policy choices. The manner in which many of these questions are negotiated will have ripple effects on three key relationships: state-society,civil-military and relations with China.

At a time of fraught state-society relations,there is no denying an element of obvious symbolism at play,and also good reasons why it will be useful to a fledgling leadership. Did you say public pressure? To be seen as being responsive to citizen demands has tremendous significance for a government trying hard to shore up its credibility. And Myitsone may have delivered just such a compelling opportunity to the leaders. The Save the Irrawaddy campaign had dramatically crystallised public opinion against a project seen as driving a dagger in the heart of the Kachins,the regions predominant ethnic minority. Suu Kyis Irrawaddy Appeal,an open letter to the government,called for a reconsideration of the controversial project. The presidents announcement to the countrys parliament speaks directly to this public sense of angst when he framed the project as being against the will of the people. Could this be an early sign of a willingness to be held to account by its citizens? It is too soon to tell.

Many of these critical transitions will also mean that civil-military,or more appropriately military-civil relations,cannot remain in a freeze-frame. The elbow room for manoeuvre for the military-backed civilian government is admittedly modest. The 2008 constitution grants vast powers to the military,and a decisive say in defining the national political leadership role of the state.

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But there are already hints of different voices coming out of the central leadership. For instance,top-ranking leaders such as Zaw Min and Thein Htay,who are considered close to former leader Senior General Than Shwe,have openly backed the project. Some of these bitterly fought internal battles could explain why President Thein Sein announced not a cancellation,but a suspension of the project for the duration of his five-year term.

As for China,the decision to suspend the project may not be the kind of serious blow to relations that it is being made out to be. For one,China has an image problem of its own to worry about in Myanmar. In fact,China has been something of a lightning rod for public opposition that is coalescing against its investments in the country,which stand at more than $12 billion. It has not helped that over two million Chinese migrant workers have accompanied these investments,complete with their pre-fabricated living quarters.

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The Myitsone project itself is part of a $20 billion seven-dam cascade investment by China,with 90 per cent electricity generated from Myitsone to be exported to the neighbouring Chinese province of Yunnan. China is increasingly growing nervous about the safety of its investments after 10 bombs exploded near the construction site last year. This will bring back uncomfortable memories of the anti-Chinese riots of the late 1960s,and more recently the halting of Chinese hydropower plants in Bhamo. The suspension of the Myitsone dam project may put more pressure on China to ensure that its other big projects do not suffer a similar fate. China is reportedly involved in more than 60 hydro,oil,gas and mining projects in the country.

Twenty years of junta-led rule on,Myanmar is attempting a difficult image makeover. The manner in which the political leadership signals a willingness to debate these will decide which way this identity transformation is headed. Myitsone may be a metaphor for many of the difficult transitions that lie ahead. The cancellation of the project may indeed be less a time to celebrate than a time to pause and reflect.

The writer is an associate professor at the Centre for Policy Research,Delhi